MORE evidence of the tough times facing Welsh high streets has emerged with new figures showing a further drop in demand for retail premises.

MORE evidence of the tough times facing Welsh high streets has emerged with new figures showing a further drop in demand for retail premises.

Demand in Wales fell for the second consecutive quarter in the three months to September, according to the Royal Institution of Chartered Surveyors’ latest UK commercial market survey.

A net balance of 24% of surveyors questioned in Wales reported a drop in demand during the period.

The falling demand was coupled with a rise in unoccupied floor space among Wales’ retail premises, with a net balance of 33% of Welsh surveyors reporting rises in availability of retail space.

With an increase of extra space available to potential retail tenants in Wales, a balance of 44% said they expected that rents would fall.

Since September there have been further troubles for the Welsh high street, as JJB Sports became the latest big-name retailer to collapse.

After administrators sold the rump of JJB to rival Sports Direct, 43 jobs were lost in Wales as branches at Cardiff, Cwmbran, Carmarthen and Haverfordwest were among 133 closed across the UK, with the loss of 2,200 jobs.

JJB is just one of a number of big retail names which have failed this year.

The biggest Welsh casualty was Cardiff-headquartered fashion retailer Peacocks, which was eventually bought from administrators at KPMG by Edinburgh Woollen Mill in a deal that saved 4,320 jobs out of the company’s total workforce of 7,500.

The biggest casualty in the UK overall this year has been Clinton Cards. Just 13 of the company’s 38 stores in Wales were retained after a subsidiary of American Greetings bought the business out of administration.

RICS Wales commercial spokesman, Chris Sutton of Jones Lang LaSalle said it had been a difficult market as many retailers rationalised their store portfolios.

"To date, 2012 has been a tough year for the commercial property market in Wales, with the greatest impact on the high street," he said. "The growth in online sales has combined with reduced consumer spending and a move by many retailers to be net reducers of space. Sub optimal stores are ditched whilst retailer requirements gravitate towards fewer retail locations."

Across Wales, the survey also found that overall demand for commercial property continued to stutter, with 19% more surveyors reporting falls rather than rises in interest from potential occupiers. Surveyors attributed the lack of demand to the ongoing challenges surrounding the economy continue to weigh heavy on businesses and their appetite to expand.

Surveyors’ expectations for future rents continued to fall, with a net balance of 26% predicting commercial property values to drop over the coming three months. Overall rental expectations in Wales have now remained negative since the autumn of 2007.

The negative outlook was also reflected across the investment market.

Mr Sutton warned that with a lack of new commercial premises being built in Wales it would prove increasingly difficult to attract new companies here.

"With speculative development of business space virtually at a halt, there is little ‘Grade A’ accommodation available in Wales to attract new and emerging industries," he said.

"The challenge for Welsh Government is to introduce measures to support new development activity and there are encouraging signs that, through the Enterprise Zones and other panels, the focus is upon creating incentives to invest rather than prescribing further costs on development."

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